Murdoch is upset — the major Australian banks will no longer lend money to the big carbon emitters. His flagship “Australian” newspaper carries this headline front and centre in its weekend finance edition: “Foreign Funding for Fossil Fuels.” The Commonwealth Bank, ANZ, Westpac, and National Australia Bank (NAB) are closing their books on fossil fuel financing. In response to shareholder pressure, they are increasing their commitments to sustainable lending and reducing their exposure to climate risk. They have set various timelines to exit direct financing of thermal coal mining.
Apparently, though, there is no hurry. Commonwealth Bank and ANZ have their exits timed for 2030, NAB for 2035. Achieving net zero by 2070. Westpac’s stance is even more nuanced. It will stop lending money to companies that receive more than 25% of their income from coal by 2030.
The federal government is “outraged” and considering rule changes that will allow access to overseas funds to finance projects in Australia. It is quite possible that if the banks won’t finance a project, the government will do so itself — as has been threatened over several projects in the recent past (including the white elephant Kurri Kurri Gas Powered Generator).
Commonwealth Bank has reduced its exposure to oil and gas by 20% over the past 12 months. It appears to have very low exposure to coal mining.
In recent years the Big Four have increased their lending to the fossil fuel sector, which makes me dubious that they will stick to their public commitment to the Paris agreement. They can talk the talk, but so far they haven’t walked the walk, and if they do, it looks like a very slow one.